Jonathan Spicer

OSLO/ISTANBUL Turkey said on Friday that an Iranian oil tanker at the centre of a confrontation between Washington and Tehran was headed to Lebanon's waters, but the United States later said the ship was sailing to Syria.

ISTANBUL Turkey's lira has risen in recent months despite Ankara abruptly sacking the central bank governor and risking U.S. sanctions over Russian missiles, silencing for now critics who had warned such moves could cause another currency crisis.

ANKARA Turkey's central bank cut its inflation forecasts on Wednesday and new governor Murat Uysal said it has "considerable" room for manoeuvre on interest rates in coming months, a week after it began an expected policy easing cycle with a big cut.

ANKARA/ISTANBUL Istanbul's new mayor now shoulders the expectations of Turkey's long-subdued opposition after he emerged from obscurity to deal President Tayyip Erdogan the biggest election blow of his career.

ISTANBUL Turkey's opposition has dealt President Tayyip Erdogan a stinging blow by winning control of Istanbul in a re-run mayoral election, breaking his aura of invincibility and delivering a message from voters unhappy over his ever tighter grip on power. | Video

ISTANBUL/BRUSSELS The U.S. government on Thursday said economic sanctions over Turkey's planned purchase of a Russian missile defence system remained a "very viable" option, even as Turkish President Tayyip Erdogan vowed to retaliate if that occurred.

ISTANBUL, June 20 Turkish President Tayyip
Erdogan said on Thursday he remains opposed to the country's
tight monetary policy and pledged a "definitive solution" to
soon lower the central bank's key interest rate from 24%.

(Repeats story without changes)
* Erdogan resumes confrontationl style ahead of Istanbul
vote
* Turkish president had kept low profile ahead of mayoral
election
* Strategy risks alienating voters who dislike polarizing
rhetoric
By Orhan Coskun, Humeyra Pamuk and Jonathan Spicer
ANKARA/ISTANBUL, June 19 Turkish President
Tayyip Erdogan has gone on the warpath against the main
opposition days ahead of a re-run of a mayoral vote in Istanbul,
scrapping plans to avoid divisive rhetoric that some officials
in his ruling AK Party believed would alienate voters.
Standing atop a bus in Istanbul on Tuesday, Erdogan claimed
the opposition's mayoral candidate Ekrem Imamoglu aligned with
coup plotters, without presenting evidence, and later warned of
unspecified actors targeting Turkey's independence.
After weeks of keeping an uncharacteristically low profile,
the president re-inserted himself into the campaign with his
usual confrontational style.
The switch is a risk for Erdogan and the AK Party (AKP),
which suffered a shock defeat in Istanbul in March local
elections – a loss that some in his party believed was in part
due to the president's uncompromising style.
The loss marked one of his biggest setbacks in 16 years in
power, and the AKP challenged the result.
According to interviews with five party officials, as well
as their advisers, Erdogan and his party had decided in recent
weeks to effectively air-brush the president from the campaign
ahead of the June 23 Istanbul vote, including erasing his face
from highway-side billboards and cancelling dozens of planned
rallies across the city.
AKP officials had concluded that Erdogan's uncompromising
approach had become a liability with some key voters in
Istanbul, especially Kurds and AKP supporters who were turned
off by his polarizing rhetoric, the party insiders said.
By laying low, Erdogan also could have distanced himself in
the event of another defeat, advisers added.
But things changed earlier this week with internal party
polling showing Imamoglu slightly ahead, prompting Ergodan to
intervene, according to two of the people.
In recent days, "Erdogan had asked party officials if it is
possible to arrange a meeting or a rally to make a speech every
day in Istanbul" ahead of the vote, a senior AKP official said.
"That's the new strategy."
Defeat on Sunday for Erdogan's hand-picked mayoral
candidate, former prime minister Binali Yildirim, would serve as
a further embarrassment for the president after the AKP
succeeded in annulling the March result.
It would also weaken what only three months ago appeared to
be his iron grip on power as Turkey battles recession, jockeys
in war-torn Syria, and balances its U.S. and Russian ties.
It may embolden challengers to his rule, although it
wouldn't immediately affect the balance of power in Ankara.
An AKP spokesman declined to comment on the shifting
strategy.
In public appearances in recent days, Erdogan urged
supporters to help him rally voters this weekend.
"We can't hand our Istanbul to these liars," Erdogan said in
a speech on Tuesday, referring to the main opposition Republican
People's Party (CHP) and its mayoral candidate Imamoglu.
Imamoglu has denied any links with the coup plotters.
"I know things will be said," Imamoglu said in an interview
with state broadcaster TRT Haber late Tuesday. He added: "These
attacks are the attacks of those who cannot digest that we are
ready for the task."
STRATEGY 'BACKFIRED'
Erdogan, the country's most dominant political figure since
the modern Turkish state's founder Mustafa Kemal Ataturk,
launched his own career in Istanbul and had served as its mayor.
The AKP and its Islamist predecessors had for 25 years
controlled the city, which has a budget of close to $4 billion
and accounts for a third of the country's economic output.
Ahead of Turkey's local elections in March, Erdogan held up
to eight rallies a day addressing thousands of voters and
millions more on live television. He delivered tough nationalist
messages, asking voters to support the AKP as "a matter of
survival."
"The Erdogan campaign strategy backfired, especially among
Kurds and middle-class conservatives," in part because of his
polarizing rhetoric said Galip Dalay, a visiting scholar at the
University of Oxford.
After Erdogan's Istanbul mayoral candidate Yildirim lost by
some 13,000 votes, the AKP complained that the election was
marred by irregularities.
Last month, Turkey's High Election Board scheduled the
re-run, a move that opponents said was politically influenced
and heightened concerns about eroding rule of law and
institutional independence.
According to AKP officials and insiders, the party is
targeting the 1.7 million voters who stayed home on March 31,
particularly conservative Kurds and AKP supporters looking for
more focus on fixing the country's stalled economy.
"People who didn't vote and disenchanted voters, as well as
Kurdish voters, will be a major factor," said one AKP official,
who added that the party was looking to boost turnout from an
already high 84 percent in March to 94 percent.
The party had in recent weeks emphasized a face-to-face
campaign in areas that had relatively low overall turnout and
high Kurdish populations, officials say.
That included bringing several elderly Kurdish leaders from
the country's southeast to the city to build support in small
neighborhood gatherings, sources close to the pro-Kurdish
Peoples' Democratic Party (HDP) told Reuters.
But a return to a prominent role for Erdogan in the campaign
in the past few days followed fresh polling data and a debate on
Sunday between the two mayoral candidates.
Imamoglu, who won the March vote, was gaining momentum,
according to figures published Monday by polling firm Mak
Danismanlik. Internal polls from the two leading parties showed
the CHP candidate enjoying a narrow lead over the AKP's Yildirim
as of last week.
"Erdogan looked at the internal polls and saw that Yildirim
still lagged behind, so he decided to go all in," said one
source close to the party with knowledge of the recent polling.
"But it could have the opposite impact on voters and push them
away."
COURTING KURDS
In Istanbul's working-class Esenyurt district, where turnout
was low in March and the CHP ousted the AKP, resident Halil
Cetin said Erdogan should step back.
"This survival rhetoric was too much at the center and
people were annoyed by this, saying 'This is a municipal vote,
what kind of a survival issue could there be?'" said Cetin,
originally from Turkey's predominantly Kurdish Diyarbakir
region. Yildirim "resonates," he added.
Among the overtures the AKP has made to Kurds in recent
weeks was lifting a years-long ban on lawyers visiting jailed
Kurdish militant leader Abdullah Ocalan, a move that prompted
several Kurdish lawmakers and thousands of prison inmates to end
hunger strikes.
But such gestures were unlikely to make a meaningful impact
on Kurdish voters, said HDP Group Chairman Saruhan Oluc. "These
little acts have no chance of creating a positive response," he
said in an interview.
The economy remains another key challenge for AKP and
Erdogan, who have seen support hurt by last year's currency
crisis that tipped Turkey's economy into recession, devalued the
lira by 30% and sent inflation soaring.
"The economy is problematic. The voters are heavily
influenced by the developments in the economy and we see the
impact of that by them not going to the ballot box," the senior
AKP official said.
(Additional reporting by Ali Kucukgocmen in Istanbul and Ece
Toksabay and Tuvan Gumrukcu in Ankara;
Editing by Jonathan Spicer and Cassell Bryan-Low)

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